Fiona Waite, Client Director, RBC Wealth Management, gives her views on what might happen this year in funds
As we enter 2018, what’s the general health of private client business in Jersey and Guernsey?
Throughout 2017, the private client industry across our islands enjoyed a very strong year. We’ve long been known as premier offshore financial centres and, building on that momentum and reputation, we’re increasingly seeing a number of clients relocate to Jersey and Guernsey.
This allows our industry to demonstrate the exceptional client expertise we offer to a larger local client base.
The work undertaken by the islands’ businesses and governments to attract inward investment is paying off. By showcasing the islands as stable, highly respected and well-regulated places to do business, live and work, we now have many new businesses, individuals and families calling the islands their home.
We’re seeing a healthy diversification in the types of businesses moving here, which in turn offers new job opportunities in developing sectors.
Many of these new clients have complex wealth planning needs, further allowing the private client industry to help these individuals navigate the management of their personal wealth.
In the next 12 months, what do you think will be the biggest challenge(s)?
Because of the strong relationships and history our islands have with the UK and Europe, the private client industry faces a number of challenges, including the uncertainty around Brexit and readiness for implementation of new regulations such as MiFID II and data-based risk supervision.
There are, of course, the global challenges that we in the Channel Islands private client business aren’t immune to. In the coming year, we must prepare for challenges such as cyber security and the rise of non-traditional competitors in the wealth management space.
While these challenges might not be resolved over the next 12 months, it’s anticipated to be a large part of the conversation for our industry, both here in the islands and around the world.
And where will the greatest opportunity lie?
The greatest opportunity for the Channel Islands’ private client industry is one that will affect our industry around the world – the transfer of wealth from one generation to the next. As our population ages, we have to consider succession planning as part of the wealth management services we provide for our clients and their families.
A study conducted by RBC Wealth Management found that within a generation, $4 trillion is expected to be passed down to inheritors in the UK, US and Canada. Those in the next generation have a different outlook as to how they want to manage their wealth, and we as an industry need to be adapting to take this into account.
While it might not be front of mind for many islanders, wealth transfer planning is a huge opportunity. It’s an important consideration for us, as wealth managers – and a necessary one – to ensure that our clients are prepared for when the time eventually comes.
Is there one thing that will dominate in the private client space this year?
The obvious answer is, of course, the most pertinent – Brexit. With the UK economy expected to continue to be mired by uncertainty, and as Westminster struggles with the task of redefining the country’s business model, clients will continue to watch with trepidation as the negotiations of the UK’s exit from the European Union continue.
It’s a topic that comes up in almost every meeting I take, and I expect the same as the UK’s exit takes a more defined form as 2018 continues.
Luckily for us, and for our clients, the Channel Islands will continue to be a stable jurisdiction during these unpredictable times.